DMH Electrical and Renewables pride ourselves on our expert knowledge of renewable technologies and being able to better inform our clients so that they can understand the systems they are investing in. Whilst we talk a lot about the systems themselves, one aspect we haven’t touched on much is the tariffs behind those systems. Understanding smart tariffs is crucial to making the most out of your renewables, and in this blog we will discuss what they are and if they are worth it.
What are smart tariffs?
Think of smart tariffs as a pricing plan for your electricity. The cost of energy changes throughout the day based on things such as live demand (capturing moments where energy is consumed, not just the total energy consumption of the day) and wholesale availability. This means that you are paying for the energy you use, rather than being charged at a flat rate.
The different types of tariffs
There are 2 types of smart tariffs – static and dynamic. Here are the key differences between them.
- Static smart tariff: As the name suggests, a static smart tariff offers a fixed energy plan. It offers higher price predictability, with rates and times being fixed well in advance. Static smart tariffs are often best for set-and-forget routines, normally used for things such as EV charging where you know you’re using energy at the same time each day.
- Dynamic tariffs: Compared to static, dynamic tariffs offer much lower price predictability, with prices updated frequently throughout the day (can be up to every half hour). If you are looking for a more flexible tariff, and your energy consumption is off-peak, then this tariff is something to consider.
What is the difference between peak and off-peak times?
It’s important to know if you use energy around peak or off-peak times. Peak times are when utilities are in high demand, such as cooking dinner between 4 pm and 7 pm or plugging in your EV to charge right after work. It costs more money to use power during peak times with higher rates.
Off-peak times are much quieter, with lower demand periods that feature cheaper rates. Many homes decide to charge their electric vehicle during cheap overnight windows so that they take advantage of the lower tariffs.
Are Smart Tariffs worth it?
Utilising smart tariffs is worth it if you’re able to shift your heavy electricity usage to off-peak hours. If you own an EV, battery storage or solar PV, you are able to store cheaper overnight energy and then use it during peak hours. By researching different suppliers and their rates, you can see which tariffs fit your lifestyle.
Making your home work smarter
The UK is becoming more energy conscious, with more households thinking about when they are using it, how they are storing it and how efficient their homes are. By combining smart tariffs with systems such as solar panels, EV chargers and batteries, homes can take back control of their energy use and the costs of running them. If you are looking to create a more sustainable home using renewables, get in touch with the team today and fill out our contact form.
